Keep Informed

Big Changes Coming to Social Security

NOTE: This is a reprint of the Advisory we first issued in early November 2015. Changes going into effect May 1, 2016.

The Bipartisan Budget Act of 2015 recently hammered out by Congress and the Administration, and signed on November 2, 2015, will cause two big changes to how couples plan for their Social Security benefits at retirement.

The legislation essentially eliminates both the "file and suspend" and the "claim some now, claim more later" techniques.

File and Suspend

Under the file and suspend technique, the spouse with the higher earnings record would claim benefits at full retirement age (typically 66) but suspend those benefits, usually until maximum benefits top out at age 70.

In the meantime, the spouse with the lower earnings record claims the spousal benefit, which is typically 50% of what the other spouse would receive, but for the suspension.

The elimination of file and suspend goes into effect for claims filed after April 30, 2016. If you qualify for this technique prior to that date, it is important you understand your options and take appropriate actions.

Claim Some Now, Claim More Later

Also referred to as the restricted application method, this technique allows a spouse who reaches full retirement age to restrict their benefit to the 50% spousal benefit only.

This allows the benefit based on their own earnings record to grow and top out at age 70, at which time they switch to their own, full retirement benefit.

For those who turn 62 after 2015, this technique will no longer be available. Presumably, anyone who is still 62 or older in 2015 will be able to use this technique at the time they reach full retirement age.